In addition to SAP, plaintiff named Matthew Iacoviello, Courtney Depeter, Patricia Lavan, Bill

1

McDermott, and Terry Laudal as defendants. The individual defendants are only party to plaintiff’s

Pennsylvania Wage Payment and Collection Law claim.

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

LARRY PANETTA, : CIVIL ACTION

Plaintiff, :

:

v. : NO. 05-4511

:

SAP AMERICA, INC., et al., :

Defendants. :

MEMORANDUM AND ORDER

Stengel, J. March 30, 2007

The plaintiff, Larry Panetta, worked for the defendant SAP America, Inc. from

1995 to 2004 as a Solutions Engineer. From 1996 to 2003, Panetta spent a significant

amount of his time on the United States Postal Service (“USPS”) project. Ultimately, on

May 28, 2004, USPS executed a $14 million software licensing agreement with SAP and,

as a result, Panetta received a bonus under SAP’s 2004 Compensation Plan. Panetta now

contends that he should have received a commission for the USPS contract based upon

any one of the annual Compensation Plans in effect prior to 2004. The defendants

disagree. SAP and its defendant officers have filed a motion for summary judgment and 1

argue that Panetta’s breach of contract and Pennsylvania Wage Payment and Collection

claims fail because the only Compensation Plan that applied to the USPS contract is the

2004 Compensation Plan — the plan in effect when the contract was executed. For the

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 1 of 19
The facts have been taken from the Second Amended Complaint, the defendants’ statement of

2

undisputed facts, and the parties’ exhibits to their briefs. The facts are viewed in the light most favorable

to the non-moving party, the plaintiff.

2

reasons set out below, I agree with the defendants and will grant the defendants’ summary

judgment motion and dismiss all claims against them.

I. BACKGROUND2

Larry Panetta began working for SAP in 1995 as a Solutions Engineer. In his role

as a Solutions Engineer, he would support the sales representatives on a prospective

client’s account and perform demonstrations for the prospective client to show them how

SAP software could address their needs. Specifically, Panetta would present SAP’s

software capabilities to potential SAP software licensing customers in the areas of human

resources and payroll. 

While employed by SAP, Panetta received a base salary. In 2004, Panetta’s base

salary was approximately $115,000. In addition to his base salary, during the years of

1995 through 2003, Panetta was eligible to receive commissions pursuant to the terms of

the annual Sales Compensation Plans. In 2004, Panetta was eligible to receive a bonus

pursuant to the terms of the 2004 Compensation Plan. The terms of the 2004 Plan were

substantially different than the 2000 through 2003 Plans. For example, the 2003

Compensation Plan provided a Solutions Engineer with a commission based on a

percentage of the total revenue generated by the software licensing deals the Solutions

Engineer helped close in 2003. Panetta electronically acknowledged receipt and

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 2 of 19
3

acceptance of the 2003 Plan. The 2004 Compensation Plan, on the other hand, did away

with the commission structure and adopted a “variable incentive plan.” The 2004 Plan

rewarded Solutions Engineers for performance in addition to revenue, i.e., it was much

more subjective. When Panetta received a copy of the 2004 Plan electronically, he did

not accept the Plan but, nonetheless, continued to work for SAP until August 2004. SAP

issued a different Compensation Plan for each of the years between 2000-2004. The

2000-2004 Compensation Plans were in effect from January 1st to December 31st of the

corresponding year. 

In 1996, Panetta began his involvement with the USPS account. From 1996 to

1999, Panetta performed minimal work or “sporadic” demonstrations for USPS. In mid1999, USPS became a bona-fide sales opportunity for SAP and, at that point, Panetta’s

role in SAP’s efforts to obtain the USPS contract increased dramatically. From 1999

through the end of 2003, Panetta was the sole human resources and payroll Solutions

Engineer that worked on the USPS deal. He worked on the USPS account to the

exclusion of other prospective clients and other potential sources of commissions. 

Panetta completed his work on the USPS account in 2003, but for reasons outside the

control of Panetta, the USPS licensing agreement was not executed until May 28, 2004. 

The value of the USPS contract to SAP exceeded $14 million. Panetta was paid a bonus

for his work on the USPS contract under the terms of the 2004 Plan, which was

significantly less than the commission amount he would have received under any of the

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 3 of 19
Panetta states in his Second Amended Complaint that he received a bonus of approximately 

3

$12,400 for his work on the USPS deal and that he was entitled to a commission of approximately

$250,000. Based on Panetta’s deposition testimony, the amount of the bonus he received from SAP in

2004 may have been in the range of $37,000. The amount of the actual bonus and the amount Panetta

believes he is entitled to under the pre-2004 Plans are irrelevant for the purposes of the motion for

summary judgment.

The new complaint contained class action allegations and asserted a claim for quantum 4

meruit/unjust enrichment. On June 22, 2006, this court granted the defendants' motion to strike the class

action allegations and the claim for quantum meruit/unjust enrichment. See Docket No. 46, 62. 

4

pre-2004 Plans.3

Panetta claims that he was not paid the proper commission for his efforts in closing

the USPS contract and initiated this case against SAP to recover the missing amount. 

Panetta filed this case in the United States District Court for the Northern District of

California. The case was transferred to the Eastern District of Pennsylvania, see Panetta

v. SAP America, Inc., No. C-05-01696, 2005 U.S. Dist. LEXIS 36813 (N.D. Cal. July 26,

2005), at which point Panetta amended his complaint to include claims under

Pennsylvania law. On April 19, 2006, the plaintiff filed a Second Amended Complaint

with the following two counts: (1) breach of contract against SAP, and (2) violation of the

Pennsylvania Wage Payment and Collection Law (“WPCL”), 43 Pa. Cons. Stat. § 260.1

et seq., against SAP and the Individual Defendants. On July 14, 2007, the defendants 4

filed a Motion for Summary Judgment (Docket No. 48) on both counts and the plaintiff

filed a response to the motion on July 28, 2006 (Docket No. 50). In addition, the

defendants filed a reply brief (Docket No. 56) and the plaintiff filed a sur-reply brief

(Docket No. 59). 

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 4 of 19
5

II. LEGAL STANDARD FOR SUMMARY JUDGMENT

Summary judgment is appropriate “if the pleadings, depositions, answers to

interrogatories, and admissions on file, together with affidavits, if any, show that there is

no genuine issue as to any material fact and that the moving party is entitled to judgment

as a matter of law.” FED. R. CIV. P. 56(c). An issue is “genuine” if the evidence is such

that a reasonable jury could return a verdict for the non-moving party. Anderson v.

Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A factual dispute is “material” if it might

affect the outcome of the case under governing law. Id.

In this case, the defendants bear the initial responsibility of informing the court of

the basis for its motion and identifying those portions of the record that it believes

demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477

U.S. 317, 322 (1986). While a plaintiff bears the burden of proof on a particular issue at

trial, a defendant’s initial Celotex burden can be met simply by pointing out to the court

that there is an absence of evidence to support the plaintiff’s case. Id. at 325. After the

defendants have met their initial burden, the plaintiff’s response, by affidavits or

otherwise as provided in the rule, must set forth specific facts showing that there is a

genuine issue for trial. FED. R. CIV. P. 56(e). That is, summary judgment is appropriate if

the plaintiff fails to rebut the defendants’ assertions by making a factual showing

sufficient to establish the existence of an element essential to his case, and on which he

will bear the burden of proof at trial. Celotex Corp., 477 U.S. at 322. Under Rule 56, the

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 5 of 19
6

court must view the evidence presented on the motion in the light most favorable to the

plaintiff. Liberty Lobby, Inc., 477 U.S. at 255. If the plaintiff has exceeded the mere

scintilla of evidence threshold and has offered a genuine issue of material fact, then the

court cannot credit the defendants’ version of events against the plaintiff, even if the

quantity of the defendants’ evidence far outweighs that of the plaintiff’s. Big Apple

BMW, Inc. v. BMW of North America, Inc., 974 F.2d 1358, 1363 (3d Cir. 1992).

III. DISCUSSION

A. Breach of Contract Claim

1. In General

 According to the allegations in the complaint, the basis of the plaintiff’s breach of

contract claim is that SAP did not comply with the 2000 Compensation Plan when it

determined Panetta’s USPS commission. Although the complaint delineates the 2000

Plan as the alleged controlling Plan, Panetta is not consistent with that assertion. In his

reply to the summary judgment motion, Panetta appears to argue that the 2003

Compensation Plan is the contract that SAP breached. In his deposition, Panetta states

that his commission should have been calculated under any of the pre-2004 “commission”

Plans. Given that the defendants’ motion for summary judgment examines the breach of

contract claim in the context of each of the Plans in effect from 2000 through 2004, this

court will evaluate the sufficiency of Panetta’s contract claim under the 2000, 2001, and

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 6 of 19
The plaintiff does not specifically argue that SAP breached the 2002 Plan and a complete copy

5

of the 2002 Compensation Plan, with its pertinent attachment for Solutions Engineers, has not been

produced to this court. Accordingly, a breach of contract claim based on the 2002 Plan will not be

considered by this court.

The 2003 and 2004 Compensation Plans state: “The provisions of the Plan shall be construed, 6

administered and enforced according to applicable Federal law and the laws of the Commonwealth of

Pennsylvania without regard to its conflict of law rules.” Since the parties do not contest that

Pennsylvania law applies here, I will examine the breach of contract claim under Pennsylvania law. See

St. Paul Fire & Marine Ins. Co. v. Lewis, 935 F.2d 1428, 1431 n.3 (3d Cir. 1991) (citing Klaxon Co. v.

Stentor Elec. Mfg. Co., 313 U.S. 487, 496 (1941)) (holding that a federal district court, sitting in

diversity, must apply the choice-of-law rules of the state in which it sits); Churchill Corp. v. Third

Century, Inc., 578 A.2d 532 (Pa. Super. Ct. 1990) (noting that Pennsylvania courts will uphold the

parties' contractual choice of law provisions to the extent that the transaction is reasonably related to the

chosen forum).

7

2003 Plans.5

SAP contends that it is entitled to summary judgment on the breach of contract

claim because the pre-2004 Plans and the 2004 Plan unambiguously provide that their

compensation incentives are limited to client contracts executed during the corresponding

calendar year. Given that the USPS contract was executed in 2004, SAP argues that the

terms of the 2004 Compensation Plan should govern the amount of Panetta’s bonus for

his work on the account.

A breach of contract claim in Pennsylvania must be established by demonstrating

the following three elements: "(1) the existence of a contract, including its essential

terms, (2) a breach of a duty imposed by the contract and (3) resultant damages." 

Corestates Bank, N.A. v. Cutillo, 723 A.2d 1053, 1058 (Pa. Super. Ct. 1999).6

SAP does not dispute for the purpose of its motion for summary judgment that the

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 7 of 19
It is worth noting that the Plans gave SAP the right and discretion to modify the terms of the 7

Plans at any time. See Herbst v. Gen. Accident Ins. Co., No. 97-8085, 1999 U.S. Dist. LEXIS 15807, at

*24-27 (E.D. Pa. Sept. 30, 1999) (granting summary judgment to employer on a WPCL bonus claim

where employer’s incentive program could be “unilaterally revised or canceled” by employer). The

plaintiff does not dispute this fact. See Panetta Dep. at 82, 124-25.

8

Compensation Plans were contracts. The question to be resolved, therefore, is whether 7

Panetta has established a genuine issue of material fact regarding SAP’s alleged breach of

an obligation to Panetta under the Compensation Plans. In order to answer that question,

the court must first look to the language of the Plans to determine the rights and duties of

the parties.

A recent Pennsylvania Supreme Court case summarized Pennsylvania’s law

regarding contract interpretation:

The fundamental rule in contract interpretation is to ascertain the intent of the

contracting parties. In cases of a written contract, the intent of the parties is

the writing itself. Under ordinary principles of contract interpretation, the

agreement is to be construed against its drafter. When the terms of a contract

are clear and unambiguous, the intent of the parties is to be ascertained from

the document itself. When, however, an ambiguity exists, parol evidence is

admissible to explain or clarify or resolve the ambiguity, irrespective of

whether the ambiguity is patent, created by the language of the instrument, or

latent, created by extrinsic or collateral circumstances. A contract is

ambiguous if it is reasonably susceptible of different constructions and capable

of being understood in more than one sense. While unambiguous contracts are

interpreted by the court as a matter of law, ambiguous writings are interpreted

by the finder of fact.

Ins. Adjustment Bureau, Inc. v. Allstate Ins. Co., 905 A.2d 462, 468-69 (Pa. 2006)

(internal citations omitted). “[A] writing must be interpreted as a whole, giving effect to

all its provisions.” Atlantic Richfield Co. v. Razumic, 390 A.2d 736, 739 (Pa. 1978). In

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 8 of 19
9

this case, the terms of each of the Compensation Plans are unambiguous. The Plans were

in effect for one year and a Plan’s compensation structure only applied to any new

licensing agreements executed in that corresponding year. Therefore, since the USPS

contract was executed in 2004, I can conclude as a matter of law that the defendants’ did

not breach any of the pre-2004 Plans. 

2. 2000 and 2001 Compensation Plans

The 2000 Compensation Plan was in effect for Sales Year (“SY”) 2000 — from

January 1, 2000 through December 31, 2000. Throughout the 2000 Plan, the objectives,

incentives, and goals established for the SAP employees are defined within the time

frame of SY 2000. A Solutions Engineer could earn a commission under the Plan “based

on the booked revenue from specific contracts and the level of participation during the

sales cycle.” In the section of the Plan discussing commissions, the 2000 Plan states:

“Commissions are not earned until the corresponding contract is booked in accordance

with SAP contract booking policies . . . .” SAP’s contract booking policies explain

revenue recognition for commission purposes and defines “booked revenue” as “all new

net software licenses” which are “booked as revenue.” Finally, in the section of the 2000

Plan that explains “revenue splits” among Solutions Engineers, the Plan states (twice):

“Commission eligibility is contingent on contract bookings.” Contract is defined in the

2000 Plan as “a legally binding agreement between SAP America, Inc. and a customer,

under which SAP software functionality is licensed.” Contract booking is defined as a

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 9 of 19
The 2000 Plan also contained the following relevant provision regarding any changes to the 8

Plan: 

SAP reserves the right to modify the Plan at any time. Notification of changes to the Plan

may be in writing or by electronic mail to affected participants. Changes will be made to

the Plan periodically. Changes may be made to revise goals and strategies, to correct

bona fide errors in the Plan, and for any other legitimate business purpose. . . . The Plan

describes the total commission and incentive for the employee. Any deviation,

modification, or other changes are not in effect unless the Plan is modified and approved

in writing by the GM/Senior Vice President(s) and the CEO or President. 

10

“contract which has been officially entered into SAP’s America’s financial records.” 

Therefore, taken each of these provisions together and viewing the Plan as a whole, the

terms of the 2000 Plan are unambiguous as to when a commission is earned.8

A Solutions Engineer is entitled to a commission under the 2000 Plan for the “net”

amount of a new, legally binding licensing agreement between SAP and a customer,

which has been officially entered into SAP’s financial records. The binding agreement

must be entered into SAP’s financial records by December 31, 2000 in order for a

Solutions Engineer to receive credit for the contract under the 2000 Plan. After

December 31, 2000, the Compensation Plan expires and its terms no longer apply. Since

the software license contract between USPS and SAP was not in existence until 2004, the

2000 Plan has no application in the determination of Panetta’s compensation for his

efforts on the USPS contract. Accordingly, I find that SAP did not breach the 2000

Compensation Plan contract.

The 2001 Compensation Plan was in effect from January 1, 2001 to December 31,

2001 (SY 2001). The terms of the 2001 Plan, including its provisions on commissions, its

definitions of contract and contract bookings, and SAP’s modification rights, are

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 10 of 19
11

substantially the same as the 2000 Plan. Therefore, for the same reasons the 2000 Plan is

unambiguous as to when a commission is earned, so is the 2001 Plan. And since the

USPS contract was not closed during the 2001 Plan’s term, SAP breached no

compensation obligation to Panetta under the 2001 Plan with respect to the USPS

account.

3. 2003 Compensation Plan

The 2003 Compensation Plan for Solutions Engineers consists of two parts. The

first part contains the general provisions of the Plan. The second part, an attachment to

the Plan entitled “2003 Measures and Rewards Package,” applies to Solutions Engineers

and details the terms and conditions for commissions and incentives. The 2003 Plan was

effective for the period beginning January 1, 2003 and ending December 31, 2003. 

The plaintiff argues that the 2003 Plan is ambiguous as to when a commission is

earned under the contract. Panetta believes that the 2003 Plan can reasonably be

interpreted to allow a Solutions Engineer to collect a commission under the 2003 Plan

based solely on the work performed in that year. Under Panetta’s interpretation of the

2003 Plan, it does not matter when the customer’s software license contract is executed, it

could be 2003 or 2013, i.e., years after the annual Plan terminates. As long as the

Solutions Engineer completes his work on a project in 2003, and the deal eventually

closes, Panetta believes the Solutions Engineer has earned his commission under the

terms of the 2003 Plan.

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 11 of 19
This conclusion is supported by the definition of the words “contract booking” and “contract” in 9

the 2003 Plan. Contract booking is defined as a “contract which has been officially entered into SAP’s

America’s financial records.” Contract is defined as “a legally binding agreement between SAP

America, Inc. and a customer, under which SAP software functionality is licensed.”

12

The language of the 2003 Plan with respect to when a commission is earned is

unambiguous and Panetta’s interpretation of the 2003 Plan is unpersuasive. It is

important to look at the language of the 2003 Plan in the context of duration. The 2003

Plan was only in effect for one year. For that one year period, each Solutions Engineer

was assigned an individual quota for software license revenue. Each level of revenue

attainment has an associated commission rate and that commission “is earned at

achievement of the appropriate revenue level.” In the chart that details the commission

structure of the Software Engineers, the revenue levels are titled “Annual Software

License Revenue Achieved.” The calculation of the annual revenue level includes

“booked revenue, ” which is “all new software licenses.” To allow into that equation the

revenue from new licenses booked in future years, it would turn an annual policy into an

indefinite policy. Therefore, a Solutions Engineer could earn a commission under the

2003 Plan based only on the new software licenses entered into during the course of that

calendar year. Since it is not disputed that the USPS contract was not closed during the 9

2003 Plan’s term, I find that SAP breached no commission obligation to Panetta under the

2003 Plan with respect to the USPS project.

In addition, Panetta’s claim that the defendants changed “without notice, consent

or writing” the terms of the Compensation Plans in an effort to deprive him of earned

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 12 of 19
13

commissions carries no weight. First, the 2003 Compensation Plan ended on December

31, 2003. As a result, SAP had every right to issue a new Compensation Plan with new

terms or issue no Compensation Plan at all. Second, SAP did not need to wait until the

end of the 2003 year to change the Compensation Plan. SAP reserved the right under the

2003 Plan to modify or change the terms of the Plan, “at its sole discretion and at any

time.” SAP did not need the plaintiff’s consent to change the terms of an expired or

existing Plan. SAP was allowed to make such unilateral business decisions. Finally, the

2004 Plan was sent to Panetta in writing and he acknowledges his receipt of the Plan. See

Panetta Dep. at 59-60 

In light of the unambiguous terms of the pre-2004 Plans, the court does not need to

consider extrinsic evidence to interpret the Plans and determine when commissions were

earned under each of the Policies. If I were to review such evidence, however, it supports

the conclusions I reached above regarding the non-application of the pre-2004

commission scheme to the USPS contract. The plaintiff admits that the pre-2004 Plans

were only in effect during their corresponding calendar years, and that under the pre-2004

Plans, commissions were earned and paid in the year in which the customer contract was

executed. See Panetta Dep. at 53-64. See also Sunbeam Corp. v. Liberty Mutual Ins.

Co., 781 A.2d 1189, 1193 (Pa. 2001) (quoting RESTATEMENT (SECOND) OF CONTRACTS §

202(5)) (“‘[T]he manifestations of intention of the parties to a promise or agreement are

interpreted as consistent with each other and with any relevant course of performance

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 13 of 19
Despite the condition precedent not being satisfied, SAP paid Panetta a bonus under the 2004 10

Plan for his work on the USPS contract. See Panetta Dep. at 68-74. I also note that even if plaintiff’s

14

[and] course of dealing . . . .’”). 

4. 2004 Compensation Plan

Finally, the plaintiff tries to draw significance from the fact that he never agreed to

the terms of the 2004 Plan. He does not explain what his legal argument is and does not

cite to any case law to support it. To the extent Panetta is arguing that his nonacceptance

of the 2004 Plan resulted in the continuation of the 2003 Plan, his argument fails. The

2003 Plan ceased on December 31, 2003 pursuant to its unambiguous terms. The 2004

Plan took effect on January 1, 2004 for all Solutions Engineers who satisfied the

conditions precedent spelled out in the “Payment Condition” of the Plan. One of those

conditions included: “[T]he completion, signature on and submission of the Plan and any

required attachments or schedules by a Plan Participant. Execution of the Plan by a Plan

Participant is an acknowledgment by the Plan Participant that he/she received, fully

understands and agrees to the terms and conditions of the Plan.” Panetta’s failure to

accept the 2004 Plan excused SAP’s performance, i.e., the payment of a bonus, under the

2004 Plan. See Davis v. Gov't Emples. Ins. Co., 775 A.2d 871, 874 (Pa. Super. Ct. 2001)

(“[A] condition precedent may be defined as a condition which must occur before a duty

to perform under a contract arises. . . . [A]n act or event designated in a contract will not

be construed as constituting [a condition precedent] unless that clearly appears to have

been the parties' intention.”). 

10

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 14 of 19
unjust enrichment claims were permitted to go forward, they would fail. In order to succeed under an

unjust enrichment claim the plaintiff must show: 

that the defendant wrongfully secured or passively received a benefit that would be

unconscionable for the recipient to retain without compensating the provider. Similarly,

to sustain a claim for unjust enrichment one must show that he conferred a benefit upon

another, that the recipient realized the benefit and that retention of the benefit under the

circumstances would be unjust. 

Herbst , 1999 U.S. Dist. LEXIS 15807, at *26-27 (internal citations and quotations omitted). SAP

sufficiently compensated Panetta for any benefit he conferred upon it. SAP paid Panetta a more than

decent salary and commissions and bonuses under the terms of the annual Compensation Plans, even

when it was not required to. 

15

5. Plaintiff’s Remaining Arguments

Plaintiff claims that his managers, in particular Matthew Iacoviello, told him to do

whatever it takes to close the USPS deal and when it closed he would be highly

compensated. See Panetta Dep. at 138-40. These statements did not modify the

applicable Compensation Plan at the time and it did not constitute any type of definitive

promise. First, all the Compensation Plans in question contained express language

regarding the modification of the terms and strictly prohibited oral changes. Second, Mr.

Iacoviello’s statements were couched in very general terms and they made no

commitment to pay Panetta any particular amount of money or type of commission. In

any event, Mr. Iacoviello could have easily been referring to the annual Compensation

Plan that was in effect at the time —one that would reward Panetta with a commission

and one both parties knew would expire at the end of the year.

Finally, Panetta argues that the USPS contract was different due to the time

commitment involved and the contract’s value to SAP. However, the USPS contract’s

uniqueness does not exempt it from the Compensation Plans. The USPS contract was

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 15 of 19
16

subject to the terms of the 2000-2004 Compensation Plans and, unfortunately for the

plaintiff, the contract was executed under the 2004 Plan.

6. Conclusion

Plaintiff’s belief that he should have been paid a commission for his work on the

USPS contract under one of the pre-2004 Compensation Plans is not supported by the

unambiguous language of the Plans. According to the terms of the annual pre-2004 Plans

and the plaintiff’s own admissions regarding the course of performance under those

Plans, commissions under those Plans were only due on software licensing contracts that

were executed during the corresponding calendar year. Therefore, SAP could not have

breached the terms of its 2000, 2001, or 2003 Plans by failing to pay commissions under

those Plans for the USPS contract that was executed in 2004. The plaintiff may have

been on the wrong end of an unfair business decision, but it was a business decision that

did not breach a contract. 

B. Pennsylvania’s Wage Payment and Collection Law 

As the Third Circuit recently stated in De Asencio v. Tyson Foods, Inc., 342 F.3d

301 (3d Cir. 2003): “WPCL does not create a right to compensation . . . . rather, it

provides a statutory remedy when the employer breaches a contractual obligation to pay

earned wages. The contract between the parties governs in determining whether specific

wages are earned.” Id. at 309 (internal quotations and citations omitted). See Banks

Engineering Co. v. Polons, 697 A.2d 1020, 1024 (Pa. Super. Ct. 1997) (stating that the

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 16 of 19
17

WPCL “only establishes an employee’s rights to enforce payment of . . . compensation to

which an employee is otherwise entitled by the terms of an agreement”). Therefore, since

the plaintiff’s breach of contract claim for earned commission wages fails, his WPCL

claim must fail as well.

IV. CONCLUSION

For the reasons stated above, I will grant the defendants’ motion for summary

judgment in its entirety and dismiss both the plaintiff’s breach of contract claim and

WPCL claim with prejudice.

An appropriate Order follows. 

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 17 of 19
IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

LARRY PANETTA, : CIVIL ACTION

Plaintiff, :

:

v : NO. 05-4511

:

SAP AMERICA, INC., et al., :

Defendants. :

ORDER

AND NOW, this 30th day of March, 2007, upon consideration of Defendants’

Motion for Summary Judgment (Document No. 48), and the responses thereto, it is hereby

ORDERED that the motion is GRANTED.

The Clerk of Court shall mark this case CLOSED for statistical purposes. 

BY THE COURT:

/S/ LAWRENCE F. STENGEL

 

LAWRENCE F. STENGEL, J.

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 18 of 19
IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

LARRY PANETTA, : CIVIL ACTION

Plaintiff, :

:

v : NO. 05-4511

:

SAP AMERICA, INC., et al., :

Defendants. :

ORDER

AND NOW, this 30th day of March, 2007, in accordance with my Order granting

the defendants’ motion for summary judgment, and in accordance with Federal Rule of

Civil Procedure 58, judgment is hereby entered in favor of the defendants and against the

plaintiff.

BY THE COURT:

/S/ LAWRENCE F. STENGEL

 

LAWRENCE F. STENGEL, J.

Case 2:05-cv-04511-LS Document 63 Filed 03/30/07 Page 19 of 19